Cabinet okays Coquina slips

CFO Alex Sink calls the lease terms for the submerged land a ripoff.

By STEVE BOUSQUET and PAUL SWIDER
Published June 13, 2007

TALLAHASSEE -- Gov. Charlie Crist and the Cabinet on Tuesday voted to lease state submerged lands to a St. Petersburg developer for private boat slips, despite claims by Chief Financial Officer Alex Sink that the deal was a ripoff.

The 3-1 vote allows the developer to triple the size of an existing, 30-slip docking facility at Waterside at Coquina Key North.

Attorney General Bill McCollum and Agriculture Commissioner Charles Bronson joined Crist in approving the project.

"This is the people's water, the people's property," Sink protested. "To me, it's like a ripoff to the people of Florida."

Sink noted that the lessee must pay a lease fee of $8,600 plus 6 percent of the annual income to the state. By Sink's calculations, the developer can make a $6-million profit over the five-year term of the lease. "Private profiteering," she called it. "To me, it's not good economics."

The project was defended by Mike Sole, Crist's secretary of the Department of Environmental Protection, who noted that after the five-year lease expires, the governor and Cabinet have the option to renew it, cancel it or change the terms.

The lease fees and other terms are already part of state law, Sole said, and the DEP plans to issue an intent to permit construction.

Ways to finagle

Sink wondered what would happen if the state did not renew the lease. Those who bought the $65,000 slips would be left with nothing. She also said the 6 percent could be manipulated by selling a package that priced the condo higher and the slip lower.

"There's all sorts of ways you could finagle this," she said.

The developers said they expect to keep renewing the submerged land lease.

"The state has not not renewed any," said Alex Walker, a partner with Prospect-Marathon Coquina LLC. "Banks finance them. It's common knowledge in Florida that this is perpetually renewable."

Added value

Walker said Sink's calculation of his profit ignores the price the developer paid initially for the Coquina Key Arms apartments that later became this development. Though the submerged land lease is a separate transaction, he said, the submerged lands have no value without the uplands where the condos sit.

The developer paid $110-million more than a year ago for the 1,000-unit apartment, then invested another $45-million converting it to a 912-unit condo. The condos sell for $170,000 to $650,000, Walker said.

Sole said the project's value is enhanced by the developer's willingness to spend $300,000 for a new public boat ramp at Sutherland Bayou in Palm Harbor, to be operated by Pinellas County. Because the project is in a county aquatic preserve, the developer had to contribute to the boat ramp to demonstrate that the project had some public interest.

Neighbors are split

Some environmentalists object.

"I see nothing wrong with a business making a profit," said neighbor Laurie Macdonald. "But at the expense of the public interest? I don't like that."

Macdonald, who lives in Driftwood and works as Florida director of Defenders of Wildlife, said she fears the project will harm the ecosystem of Big Bayou and threaten animals that live there, despite assurances by the DEP and the developer that they've done all they can to make the slips environmentally benign. She also said the slips would add boat traffic to an otherwise tranquil bay.

"We all have boat slips, why shouldn't they?" said another Driftwood resident, Jopie Helsen, who operates Sailor's Wharf, a boat maintenance yard in Southeast St. Petersburg. "Everybody who lives in Florida wants a boat slip."

The condo slips, for boats 26 feet or shorter, will address a growing need for slips in Florida, Helsen said.

The project has no fueling station and no sewage pumpout. The slips will be built away from sea grasses and tall enough to allow sunlight to shine through to the bottom.

They accompany another 211 slips the developer rebuilt on the project's other half at the southern end of the island.

Crist said he voted for the project because he believes it is good for the taxpayers. "It's free enterprise," Crist said.

McCollum, while voting yes, also voiced concerns about whether the deal made financial sense. "The 6 percent is probably not high enough for the state, in this day and age," McCollum said. "We could be getting more, and I don't think it would deter development."